It was my understanding that Dolby Digital's encoding scheme cuts off some of the high end frequencies that our ears can hear. DTS does not throw away these frequencies and should be able to provide the full range of frequencies that we are able to hear. So technically speaking, DTS is a better encoding scheme, but like many have already said, it really depends on the movie. In my experience though, if a DVD has both Dolby Digital 5.1 and DTS on the same DVD, I would choose the DTS track. I don't think I have ever heard a DTS track that sounds worse than the Dolby Digital 5.1 mix, but I have heard Dolby Digital 5.1 mixes that don't sound as good as their DTS counterparts. On the same lines, I would buy the DTS encoded version of a DVD versus the Dolby Digital 5.1 encoded version for DVDs that have different versions.
At the same time, good Dolby Digital mixes (mostly the THX Certified ones) can sound very very good, Toy Story 1 and 2, and Star Wars Episode 1 are both good examples of this.